BTW, a slipped liner tends to cause a BIG leak. A failed headgasket would be a smaller leak. From the sounds of your symptoms, it might be a headgasket leak, rather than a slipped liner. How does one tell? I don't really know, I'm sorry.
I think it may be worthwhile to start looking on eBay for a slightly used V8, as it may be cheapest just to do an engine swap.
When I had to replace my engine, I wish I saw this ad sooner:
LAND ROVER DISCOVERY MOTOR SERIES 2 2001 V8 4 L LOW KM - eBay, Land Rover, Car Parts, Cars, Bikes, Boats. (end time 09-Feb-08 22:09:18 AEDST)
